Proclamations… President Trump signed two proclamations yesterday that impose tariffs on steel (25 percent) and aluminum (10 percent), in order to defend national security. The tariffs go into effect in two weeks, but Canada and Mexico may get tariff relief if renegotiations of the North American Free Trade Agreement favor the United States. The White House says all other countries can make their case for tariff exemption by, in part, defining how they will strengthen their national security relationship with the United States.
Other actions and reactions… Also yesterday, the nations of Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam signed a free trade agreement without the United States. China has promised a “justified and necessary response” to US tariffs. Meanwhile the Council on Foreign Relations released a study indicating that the proposed tariff of 25 percent on steel imports could cost the US auto industry 45,000 jobs, equivalent to about a third of the entire steel industry’s work force.
Barrow and Furman: The TCJA will not pay for itself. Conservative economist Robert Barrow and Jason Furman, former economic adviser to President Barack Obama, both now of Harvard, released a new estimate of the net cost to the Treasury of Tax Cuts and Jobs Act. They find the law would cost $1.2 trillion over a decade. Barrow and Furman will present their research at the Brookings Institution today.
US Chamber of Commerce requests TCJA guidance. The Chamber, in a letter to the Treasury and IRS, “strongly urges Treasury and the IRS to work closely with the business community to implement the recent tax changes in a manner to ensure as little disruption as possible to normal business operations and to ensure this law encourages the US economy to achieve its true growth potential.” For example, the group seeks guidance on the new deduction for income of pass-through businesses, the limit on the deduction for businesses' interest expenses, and international tax provisions.
Unclaimed tax refunds are piled high at the IRS. The agency announced yesterday that tax refunds worth $1.1 billion may await claim by one million people who have not filed 2014 federal income tax returns. To collect any refund due, taxpayers must file their 2014 return by Tax Day: Tuesday, April 17. Acting IRS Commissioner David J. Kautter said “There’s no penalty for filing a late return if you’re due a refund.” Makes you wonder, why do taxpayers leave money on the table?
If you’d like to tell us about a new research paper or have any comments about the Daily Deduction, TPC’s summary of the day’s tax news, write Renu Zaretsky at [email protected]. You can sign up here to receive the Daily Deduction as an email newsletter every weekday morning (Mondays only when Congress is in recess) at 8:00 am.
